Taiwan’s HTC Corp. 2498.TW +5.05% is taking its smartphones to Myanmar, joining an expanding list of foreign companies seeking a foothold in one of Asia’s last investment frontiers.HTC is looking to tap new markets amid heavy competition from rival handset makers Samsung Electronics Co., 005930.SE +1.24% Apple Inc. AAPL -3.57% and low-cost Chinese manufacturers ZTE Corp. 000063.SZ +4.35% and Huawei Technologies Co. The Taiwan company’s foray into Myanmar could help drive the company’s growth in the medium term. Companies including Coca-Cola Co., MasterCard Inc., and General Electric Co. have already expressed interest in the country as it continues to open up its economy.

“Myanmar is opening up and opportunities are everywhere,” said HTC Chief Executive Peter Chou, who was born and raised in Myanmar.

Myanmar has the lowest mobile penetration rate in Asia. Thura Swiss Ltd., a consulting company, estimates that around three million people, or only 5% of Myanmar’s population, use mobile phones, most of which are low-end handsets. There are only two carriers in the country: Myanmar Posts & Telecommunications and smaller rival Yatanarpon Teleport Co.

That picture could change soon. Nomura Securities said Myanmar’s telecommunications regulator is drafting a law that would grant up to five more licenses to telecom operators, and possibly let in foreign investors.

Myanmar’s government has also been cutting prices of mobile SIM cards since early last year, to $140 from $500, to encourage use and meet the official target of 50% for wireless penetration by 2015, according to Thura Swiss.

The SIM cards are issued by a government ministry, which hasn’t explained its prices. Analysts have cited the high price of SIM cards as the main factor behind low mobile usage.

Thura Swiss said if the additional licenses are issued, competition could lead carriers to issue free SIM cards and that would create more demand for mobile phones. “The mobile market there is crowded with low-cost devices. We will take it slowly. So such a foray won’t help HTC’s overall shipments in the short term,” Mr. Chou said.

To attract local buyers, HTC developed a new input system for Burmese characters.

Singapore-based KMD Co., HTC’s retailer and dealer in Myanmar, said six handset models will be on sale starting Monday. The phones range from high-end units such as the One X+, One X and Butterfly, to the mid- to low-end models Desire X, Desire VC and Desire V.

HTC and KMD declined to disclose pricing for the phones.

Thura Swiss said low-cost phones from Huawei and Samsung are the top sellers in Myanmar, followed by models from Sony Corp. 6758.TO +1.55%